You’re not imagining things—you really are paying more for your healthcare. In fact, employees are taking on an ever larger share of their medical costs, according to a new report released by Kaiser Family Foundation. In 2018, premiums and deductibles increased faster than wages, and nearly 50% of those covered by their employers pay high out-of-pocket costs for their specialty drugs.
Here’s what you need to know.
Premiums are increasing
Total spend on health plans continues to increase, far surpassing the overall cost of living. From 2017 to 2018, the average premium for single coverage increased by 3% to $6,896, while family coverage saw an increase of 5% to $19,616.
Companies are also passing on more of their health costs to workers. On average, workers with family coverage pay $5,547 towards their premium, up from $4,565 in 2013.
Why does this matter? Premiums for family plans have increased, likely impacting worker compensation as employers pay more to insure their employees.
Deductibles went up again, but modestly
The average deductible increased by 4.5% since 2017, from $1,505 to $1,573. A modest amount, compared to other years, and analysts expect 2018 to see a similar rise in 2019.
This increase in deductibles outpaces workers wages, leaving employees paying more out of pocket every year.
Coverage for specialty drugs is changing
Nearly half of employees at large firms are enrolled in plans with a separate tier for specialty drugs, which can have huge cost implications for employees. Plans with their own specialty tier tend to have high out-of-pocket requirements, which can lead to a decline in adherence. In fact, a recent study showed that non-adherence nearly tripled when out of pocket costs surpassed $100 for specialty cancer drugs.
Coinsurance—where employees pay a percentage of the drug’s price—is also on the rise for specialty drugs, and more employees are on the hook for a larger share of their specialty medications. This year, 59% of all plans in large firms had a separate tier for specialty drugs requiring coinsurance, up from 46% in 2017.
This rise in co-insurance plans has huge implications for employee’s out-of-pocket costs. Employees with coinsurance for specialty drugs will have to pay 24% to 26% of the cost of their drug, compared to a copay of around $100.
To put it in perspective, employees taking Harvoni for hepatitis C will pay well over $7,500 out of pocket each month for their prescription if their plan does not limit the maximum costs out of pocket.
Kaiser Family Foundation surveyed 2,160 companies of all sizes in this analysis.
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